FRANCE’S MARKETING STRATEGY Laura Rolka Allyson Kappers Ronita Farria Tim Rittenhouse Segmentation of Target Markets On-the-Go Parent(s) with Young Children Higher income cities or suburbs with a disposable income Residence with more freezer space Afford extras such as this product Frequent Hypermarkets (prime for retailing popular products and brands Families with working parent(s) and/or single parents Lifestyle allows for less time to prepare a meal Difficult to find time for family activities except for the weekend Ages 5-18 years old: Children and Teens Usually only 1 or 2 children in household Easier to influence parents buying habits Adaptable and flexible lifestyles and tastes Athletic and active and need quick snack/meal in between activities, which is gaining grounds in Paris Like high quality foods (Smuckers) with American image (Uncrustables) More likely to try American cuisine with this age Prepackaged food industry is focusing on these tastes CHOSEN MARKET: Ages 25-34: Business Professionals Division between traditionalists and conservatives Main cities: Paris, Marseille, Lyon, Toulouse, Nice Traditionalists are getting older and more of the conservative demographic is entering into the workforce Paris is 2.5 times as dense as NYC’s population Downtown business sector, government buildings, public transportation areas, etc. More likely to try American cuisine with this age Likely to want a quick, convenient meal Want the ability to rapidly grab lunch at convenience store Shop for quick meals at hypermarkets Prepackaged food industry is focusing on these tastes They have taken an interest in the American culture Higher income regions with a disposable income 1075 E/month = $1403.56 per month in U.S. Standard of living in France is 9% above average in EU Afford extras such as this product Frequent Hypermarkets (prime for retailing popular products and brands) Reasons For Targeting Our Segment Consumer Behavior Spending patterns Consumption (% of household spending): Food, drink and tobacco: 17.8% Frequent convenient stores and hypermarkets Tastes Peanut butter? Like peanuts, Nutella, good for your health… perhaps new opportunity for trial Enjoy jams, marmalades, and cheese Enjoy prepackaged and/or frozen meals Shortened 35 hour work week Less leisurely lunch break Legislation cut from 1.15 hours to 38 minutes Eating more sandwiches, especially packaged Don’t eat between meals, so use this as a quicker meal to keep with the tradition of no snacking Growth of French Labor Force Total Population: 60,180,529 Ages 25-34: 8,302,000 (13.8% of total population) Labor Force: 27,100,000 (45% of total population) Ages 25-34 in Labor Force: 3,735,900 Positioning NOW: Uncrustables is a crustless sandwich REPOSITION using 2 strategies Benefits Meet the benefit of convenient prepackaged sandwich Usage Occasion Use for shortened lunch break or when get home late from work Trend of rising sandwich consumption Build equity because unfamiliar with Smucker’s and Uncrustables 2.4 sandwiches sold per year per person Continue wholesome, high quality, and reliable product image Different type of sandwich but not to take away from the traditional French foods Use their jams, cheeses, and ingredient preferences (discuss in product section) Positioning With Other Markets Frozen ready made meals dominate the market 2003: 51.8% of the market Fits right in a sustained growth industry Little competition Unilever McCain Saveurs de France Specialty frozen desserts and bakery products Some non-refrigerated Marketing Objectives We hope to penetrate our target market of 3,735,900 by 10% = 373,590 units We chose 10% because this product is in the Introductory Phase We also wanted just enough to capture the percentage that want to experience American culture In selling the product for $4, we hope to sell an average of 1 sandwich per person 1 sandwich (373,590 people) = 373,590 units $4 (373,590 units) = $1,494,360 sales We chose an estimate of $4 because in our research, the cost of a cheese sandwich in a restaurant is roughly $4.16 Our sandwich is slightly cheaper since it’s purchased from the store ready made, rather than a restaurant Product Size of Product Current size: 2 ounces= 58 grams We have decided to keep the size of the product the same because the French eat smaller portions compared to the US even though we have changed the target market. 1 sandwich equals a meal Color(s) of Product White-bread Brown- peanut butter filling Red- strawberry filling Cream- cheese filling The only thing that will change is the color of the cheese sandwich filling from the yellowish orange (American cheese) to the cream (Camembert) because the cheese type is changing. Materials of Product White bread Strawberry jelly Jif peanut butter Camembert- white French cheese We have decided to change the American cheese to a more consumed French cheese, Camembert. We will use the already existing Smucker’s Strawberry jelly. Even though they don’t know much about peanut butter, they do know about peanuts, so the peanut butter filling will stay. Design of Products The design of the product will remain the same: a crustless sandwich with ridges around the perimeter and filling in the inside. It will remain a frozen product. Packaging Packaging materials: The packaging materials will remain the same. Package design: This will change to individually wrapped sandwiches in clear wrapping with a smaller cardboard box around it (1 sandwich per box). Logistics purposes Package colors: The colors on the box will correlate to what the filling is on the inside. Brand Name Brioche: Because they will be manufacturing the sandwich and this will appease consumers who support French buy local sentiments. Their products are sold in markets and already have brand recognition and equity with consumers. Sandwich Prêt (“Ready Sandwich”) will be the new product name Manufacturing & Distribution Brioche Pasquier & Smucker’s: Strategic Alliance Definition: Relationship whereby two or more entities cooperate (but do not form a separate company) to achieve the strategic goals of each. Advantages: Share costs/profits of developing new products Gain access to partner’s channels Brioche Pasquier Company Profile France's leading pastry and bread maker. Makes products available to the masses through supermarkets in France. Including Auchan, Carrefour, Casino, Comptoirs Modernes, Intermarche, Leclerc, Paridoc, Promodes and Unico. Products: Viennese bread, buns, tarts, cakes, biscuits, pastries and fritters, Frozen pastries, ice cream and other desserts. Sales: Cakes and pastries account for around three-quarters of total sales. Frozen pastries contribute about a fifth of total sales. The company generated revenues of E496.83 million in the fiscal year ended December 2003 Brioche Pasquier Facilities The company has 2 factories throughout France: *Lorraine region of France (Eastern France)* Vannes region (Western France) Enables them to cope with product demand. Brioche is headquartered in Les Cerqueux, France. In NW France Distribution: Why Saveurs de France-Brossard? 98.5% of revenues coming from domestic sales Markets it products through Brossard Distribution (a 99.99%-owned subsidiary) w/ distribution centers throughout France Refrigerated Transportation (trucks, cars, etc) Operates in two major mass-market product areas: Frozen foods Industrial/ambient pastries Long-life sweet pastries (stay fresh for over 4 months) Brossard group is present in all retailer outlets, non-retailer catering and in the main specialist outlets Devoted to optimizing its organization (industrial, commercial and administrative) in a bid to position the group as a: Leader in specialty frozen foods Leader in industrial pastries. Distribution Methods The company uses two distinct distribution methods. Direct sales to consumers via retail outlets Supermarkets, hypermarkets, freezer centers and frozen product home services. Through merchants (for out-of-home catering), commercial caterers, collective organizations and small buying centers. Distribution Facilities Brossard Distribution **Head Quarters: Northern France** Alpes de Haute Provence: Southern France Route Pont de l'Arche 27110 LE NEUBOURG Innovatrice Gastronomie et Alimentation Legere Zone Industrielle Saint Maurice 04100 Manosque Franche-Comte: Eastern France Pikiche (Sogenale) 5 Route de Moncey 25870 Thurey Le Mont Pricing Start with retail price of $4.00 Production 0.15(4.00)= 0.60 Distribution 0.20(4.00)= 0.80 Divided by 1.17 (VAT)= $3.42 Divided by 1.60 (Retail Markup)= $2.14 3PL Markup 0.80*1.34= 1.07 TOTAL $2.54 (cost to make/distribute) $2.14- $2.54= 0.40 loss per unit Expect to lose 373,590 (0.40)= $149,436 overall loss estimated for 1 sandwich per person for 1 year Promotions: 4,852.55 Euro ($6,360 USD) * 4 = $25,440 USD $25,440 divided by 373,590= $.07/Unit Promotion Communication Objectives and Overall Message To create awareness of Sandwich Pret among 10% of business professionals between the ages of 25-34 who live in large French cities, primarily in Paris and value quick, convenient prepackaged sandwiches within one year. Message: Quick convenient prepackaged sandwich Due to sandwiches on the rise Shortened lunch break Advertising Business Publication Informations Enterprise Monthly distribution (in French) Circulation of 60,000 1 Page B/W Ad 4,852.55 Euro ($6,360 USD) 1 Ad every 3 months (4 Total) Total Cost: 19,427.93 EUR ($25440) Introductory Phase Make consumers aware by using print ads Prefer REACH strategy rather than Frequency Strategy We are going to start off with ads in Business Publications Will move into Sales Promotion, Event Sponsorship, PR, Direct Marketing, Personal Selling as we make profits